Which of the Following Allows the Auditor to Limit the Exposure

question 82

Multiple Choice

Which of the following allows the auditor to limit the exposure to sampling risk?

• A) Determining an appropriate sample size, yes; performing an appropriate audit procedure, yes.
• B) Determining an appropriate sample size, yes; performing an appropriate audit procedure, no.
• C) Determining an appropriate sample size, no; performing an appropriate audit procedure, yes.
• D) Determining an appropriate sample size, no; performing an appropriate audit procedure, no.

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Definitions:

IASB

The International Accounting Standards Board, which sets and enforces rules for accounting practices worldwide.

FASB

The Financial Accounting Standards Board, an organization responsible for establishing accounting and financial reporting standards for companies and non-profit organizations in the United States.

Financial Statements Elements

The key components of financial statements, including assets, liabilities, equity, revenue, and expenses.

Hierarchy of Qualitative Characteristics

An organized structure prioritizing the qualities important for financial information to be useful, such as relevance and reliability.